Chapter 7

Tax Base Analysis

IMAGINE The Town of Indian Trail Comprehensive Plan

C H A P T E R 7 T A X B A S E A N A L Y S I S

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Assessed Share of

Type Value Total

Residential $3,315,689,154 66.8%

Commercial $1,645,484,770 33.2%

Total $4,961,173,924 100.0%Source: Union County, Indian Trail,

Kimley-Horn and Associates

This Chapter forecasts the potential increase in real property tax value for the Indian Trail Planning Area based on the 2012 to 2032 land demand forecasts. Real property tax revenue is based on average land and building assessments by land use as demonstrated in Union County tax data. All results are presented in 2013 dollars. Because of the assumptions required for this analysis, it is intended to provide a general measure of magnitude for planning purposes only. It is not a comprehensive fiscal impact analysis.

7.1 CURRENT TAX BASE SHARES

As shown in Table 7.1.1, the Town of Indian Trail Planning Area’s real property tax base totaled $4.96 billion in fiscal year 2012-2013. It is important to note that personal property and equipment is not included in this figure.

Table 7.1.1: Current Real Property Tax Base by Type, Planning Area, 2013

The real property tax base is currently weighted at 66.8% residential and 33.2% commercial. Residential land and structures have a total real property value of $3.3 billion, while non-residential uses (retail, office, and industrial) totaled $1.64 billion. The current share was derived by utilizing the ‘Land Description’ classification in Union County tax parcel data.

7.2 POTENTIAL NEW TAX BASE (2012-2032)

Average values in 2013 dollars were used to forecast the future build-out assessed value for both residential and non-residential uses. Average values were obtained from Union County tax data for the Planning Area. 7.2.1 Residential

The 20-year forecasted residential demand has an estimated assessed value of $1.33 billion (Table 7.2.1). Average values per unit range from $75,000 for a multi-family unit to $215,000 for a single-family detached unit. It is important to note that these average values include the cost of land and structure. Single-family detached units are expected to comprise the largest share of new assessed value at $1.13 billion, followed by $112.5 million for multi-family, and $87.7 million for single-family detached (townhouses).

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Total Average Total

Type Units Value/Unit Value

Single-Family Detached 5,255 $215,000 $1,129,825,000

Single-Family Attached 675 $130,000 $87,750,000

Multi-Family 1,500 $75,000 $112,500,000

Total 7,430 $1,330,075,000Source: Union County Tax Assessor, Kimley-Horn and Associates

Total Average Total

Type Square Feet Value/Sq.Ft. Value

Retail 617,669 $200 $123,533,800

Office 578,420 $200 $115,684,000

Industrial 666,800 $70 $46,676,000

Total 1,862,889 $285,893,800Source: Union County Tax Assessor, Kimley-Horn and Associates

Table 7.2.1: Potential Residential Tax Base

by Type, Planning Area, 2012-2032 7.2.2 Non-Residential Similar to housing units, average values for net new commercial demand were calculated using 2013 dollars. Derived from Union County tax data, retail and office uses are assumed to have an assessed value of $200 per square foot, with industrial valued at $70. Similar to residential, the average values per square foot include the cost of land and structure. Based on the forecasted 2012-2032 demand, the net new non-residential uses could have a total assessed value of $285.9 million. Retail uses are expected to have an assessed value of $123.5 million, followed by office at $115.7 million, and industrial at $46.7 million.

Table 7.2.2: Potential Non-Residential Tax Base by Type, Planning Area, 2012-2032

7.2.3 Vacant Land

Based on an analysis of recent tax parcel data for the Planning Area, vacant land has an average assessed value of $26,100 per acre (Table 7.2.3). The amount of vacant land required to support the forecasted residential demand is 2,207 acres. It should be noted that the tax base analysis utilizes the mid-point of the forecasted land demand presented in Chapter 4. The 2,207 acres for future development have an estimated assessed tax value of $57.6 million.

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Total Total Average Total

Type Units Acres Value Value

Single-Family Detached 5,255 1,971 $26,100 $51,433,313

Single-Family Attached 675 127 $26,100 $3,303,281

Multi-Family 1,500 109 $26,100 $2,854,688

Total 7,430 2,207 $57,591,281Source: Union County Tax Assessor, Kimley-Horn and Associates

Total Total Average Total

Type Square Feet Acres Value Value

Retail 617,669 52 $26,100 $1,357,000

Office 578,420 49 $26,100 $1,270,771

Industrial 666,800 69 $26,100 $1,797,879

Total 1,862,889 170 $4,425,650Source: Union County Tax Assessor, Kimley-Horn and Associates

Additional Forecasted

Assessed Assessed Value Less Value of Assessed Share of

Type Value (Current) (2012-2032) Vacant Land* Value (2032) Total

Residential $3,315,689,154 $1,330,075,000 $57,591,281 $4,588,172,873 70.4%

Commercial $1,645,484,770 $285,893,800 $4,425,650 $1,926,952,920 29.6%

Total $4,961,173,924 $1,615,968,800 $62,016,931 $6,515,125,793 100.0%Note: This column represents the value of currently vacant land for future development.

Source: Union County, Indian Trail, Kimley-Horn and Associates

Table 7.2.3: Potential Tax Value of Vacant Residential Land, Planning Area, 2012-2032

As shown in Table 7.2.4, the forecasted non-residential land demand is approximately 170 acres. Based on the average value of $26,100 per acre, the vacant land required to complete 1.8 million square feet of retail, office, and industrial space would have a total assessed value of $4.4 million.

Table 7.2.4: Potential Tax Value of Vacant Non-Residential Land, Planning Area, 2012-2032

7.3 POTENTIAL FUTURE TAX BASE SHARES

Table 7.3.1 demonstrates the forecasted assessed value in the Indian Trail Planning Area in 2032. Based on the demand forecasts, the potential additional assessed value between 2012 and 2032 could total $1.61 billion; the 7,430 new residential units would make up over 80% of the total.

Table 7.3.1: Potential Real Property Tax Base by Type, Planning Area, 2032

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As previously noted, average values used in this analysis include the cost of structures and land. In order to avoid double-counting the value of land in this analysis, the value of vacant land was subtracted from the net new demand. This equates to a total forecasted assessed value of $6.51 billion in 2032. Overall, the real property tax base is forecasted to be 70.4% residential and 29.6% commercial in 2032. Residential land and structures would have a total real property value of $4.6 billion, while non-residential uses (retail, office, and industrial) could total $1.9 billion.